Under Niccol, Starbucks has focused on improving the customer experience through a simplified menu and shorter wait times, helping deliver four consecutive quarters of comparable sales growth.
“We have more work to do,” Niccol said in a statement on Wednesday (July 29), while chief financial officer Cathy Smith said the company remains focused on what it can control amid a “dynamic operating environment”.
The Seattle-based company now expects global same-store sales growth of around 6%, up from its previous forecast of about 5% or higher. It also expects adjusted earnings per share of $2.55 to $2.65, compared with its earlier guidance of $2.25 to $2.45.
“Starbucks has begun to experience market share stabilisation in recent months, most notably among younger diners,” Consumer Edge analyst Michael Gunther said.
“Consumers may be shifting dining dollars toward in-home eating but are leaving room in the budget for daily drink habits,” he added.
The company’s “Back to Starbucks” strategy had weighed on margins because it required significant investments in staffing and store operations. Starbucks has sought to offset those costs through layoffs, office consolidation and broader operational streamlining.
The company said refunds received during the quarter “largely offset” tariff-related costs incurred so far this financial year.
Starbucks’ consolidated quarterly operating margin improved to 14.4% from 10.1% a year earlier. The company reported adjusted earnings per share of 85 cents, ahead of analysts’ estimates of 66 cents.
Starbucks also reported third-quarter global same-store sales growth of 7.9%, comfortably exceeding analysts’ expectations of 5.7%, according to LSEG data.
